SBI rules out lending rate cut, says it has the lowest already

State Bank of India (SBI) has ruled out the possibility of cutting its minimum lending rate or base rate, saying it was already the lowest in the market.

Finance Minister P Chidambaram had on Wednesday urged public sector lenders to reduce lending rates to stimulate credit growth.

"We are already at the lowest. We are at 9.7 per cent (base rate). Other banks have been asked (by Finance Minister P Chidambaram) to come to SBI level," SBI Chairman Pratip Chaudhuri said. "Our home loan rates are at 9.95 per cent, everybody is at 10.2. We are ahead of the curve."

The average base rate of other banks is 10.2 or 10.25, Chadhuri added.

Chaudhuri also said that India's largest public sector bank is very comfortable on the liquidity front. "I am having Rs 50,000 crore of excess liquidity," he said.

The finance minister had in his meeting on Wednesday made case for passing on the benefits of a series of rate cuts, implemented by the Reserve Bank of India (RBI) during the past few months, to the borrowers.

"We have advised banks to take a look at the base rate... I have impressed upon the bankers...the Reserve Bank of India has cut its policy rates by 125 basis points and some part of this must indeed be passed on to the borrowers," the minister had said.

A cut in the base rate would be a powerful booster for the economy and a powerful stimulus to credit growth, Chidambaram had said.

With inputs from PTI